California started sending out the inflation relief payment, called the Middle Class Tax Refund from October of last year. Although the state is already done sending the refund money, it is estimated that over a million Californians have not yet claimed the Middle Class Tax Refund.
Not Yet Claimed The Middle Class Tax Refund? What To Do
Eligible recipients received up to $1,050 in the form of a Middle Class Tax Refund. The amount of refund varied based on filing status, number of dependents and the adjusted gross income.
For instance, individuals with an annual income below $75,000 were eligible for a full refund of $350. Similarly, a married couple filing jointly and with one dependant could get $1,050.
California’s Franchise Tax Board sent most payments through direct deposit, while some payments were also sent via debit card. Although the Franchise Tax Board has sent all the payments, it is estimated that more than a million Californians have not yet claimed the Middle Class Tax Refund.
According to the Franchise Tax Board, it mailed out about 9.6 million debit cards, but of those, 5% were never activated. That means that around $750 million still needs to be claimed. The debit card has an expiry date of April 2026. So, recipients must activate the card before that.
Money Network, the debit card company, has been sending reminder letters to taxpayers who have not yet claimed the Middle Class Tax Refund. If you get a letter saying you never activated your card, you need to contact Money Network at (800) 240-0223 to claim the refund.
Several people, however, have reported that they can’t get through to Money Network, but keep getting the message, “due to high call volume, we can’t talk to you now.” Still, it is recommended that you keep trying.
Money Network has received over 22 million phone calls since last October to address issues related to lost cards, stolen cards, fraud, and more.
For more details on the Middle Class Tax Refund, visit this link.
Is The Refund Taxable?
In separate news, the IRS issued new guidance on the taxability of the Middle Class Tax Refund last month. The guidance was mainly for those who reported the Middle Class Tax Refund as taxable income when filing their tax return this year.
In its new guidance, the agency clarified that it wouldn’t be necessary to report the Middle Class Tax Refund as income. Taxpayers who have already filed their return this year and reported the refund as taxable income “should consider filing an amended return,” the IRS said in its guidance.
If a taxpayer hasn’t included the refund amount in their 2022 income for federal income tax purposes, the IRS says that it won’t “challenge the treatment of the 2022 payment as excludable for income on an original or amended return.”
This article originally appeared on ValueWalk
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